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The Effects of Population Aging and Life Expectancy on Economic Growth: The Case of Emerging Market Economies
Abstract
This study examines the effects of gross saving rates, gross capital formation, population aging, and life expectancy on income growth between 1985 and 2018 for selected emerging market and middle-income economies. The estimates by feasible generalized least squares (FGLS), fully modified ordinary least squares (FMOLS), dynamic ordinary least squares (DOLS), canonical cointegrating regressions (CCR), and Driscoll-Kraay methods show the impact of population aging on income growth is positive. However, life expectancy gives positive results for gross domestic product per capita growth and negative results for gross domestic product growth. The results confirm that there is still an increasing population for emerging economies in general. In this respect, they also point to the neutral view approach for these countries. This situation highlights the importance of considering the effects of population aging on sustainable economic growth in emerging countries. For this reason, decision makers in these economies must monitor population structures closely and carefully.
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